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Bonds can be purchased on both primary (when bonds are first issued) and secondary (subsequent trading) markets. There are wholesale markets for large institutions (with trades of at least $1 million) and retail markets for individual households. TreasuryDirect.gov is available for purchases of traditional U.S. Treasuries, TIPS, and I bonds, in taxable accounts, without any…

When it comes to retirement income bond ladders, Joe Tomlinson created a taxonomy of different types in his 2014 Advisor Perspectives column, “Why the Risk Reduction Benefits of Bond Ladders Have Been Overstated.” His list inspired me to create a more extended version in Exhibit 1. Click here to download Wade’s fact sheet, “What Is…

Everyone wants to know where they stand with their finances – Will I be able to have the retirement I want? Do I have enough? Roughly how far do I have to go? Am I overfunded (believe me, it happens)? A funded ratio is a great tool for taking stock of your financial picture as…

No one likes talking about what will happen as they get older. It’s just not really a fun topic. But it’s an important one. Fidelity recently released a study that shows a massive disconnect between what parents and their children expect as their parents age. As the author says, your children are happy to help,…

Figuring out how much you can safely spend from your investment portfolio in retirement is hard. It’s incredibly easy to make a bad decision, the consequences are severe, and you won’t even realize you’ve made a mistake until it’s too late to do anything. While there’s some debate about what a “true” safe withdrawal rate…

Those seeking a do-it-yourself approach to duration matching with bond funds may underestimate the difficulty of the task. Duration-matching is not straightforward when shares of the bond fund must be sold to meet ongoing retirement expenses. If rates have risen, shares of the bond fund may need to be sold at a loss, with more…

Last time, we discussed how DFA’s target-date retirement income funds can help guard retirees from interest rate risk. Today, I want to look at another example of a bond fund used as a safeguard against interest rate risk: BlackRock’s series of CoRI Retirement Indices. The CoRI Retirement Indices are gauged to help retirees understand the cost of…

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It’s always fun to take a couple of swings at hedge funds (though it’s starting to feel like punching down lately). It looks like the outflows from hedge funds will continue in the coming year. Both because of performance (according to a survey referenced in the article, only 3% of managers and investors thought that hedge…